The New Luxury: What Are the Latest Indicators of Wealth?
The widespread global success of luxury brands—considering they carry the term ‘luxury’—owes a high percentage of its revenue to the spending of the middle class and little credit to the upper echelons of society as one would imagine. Members of the Old Money faction have been known in the past to practice what economist Thorstein Veblen calls "conspicuous consumption," an idea that the moneyed use material possessions as indicators of social status but with the easy accessibility to "luxury" items such as designer bags and sports cars, these material possessions have lessened their merit. So what do the elite blow their money off on these days? It’s surprising but very practical.
Education, Not Material Possessions
Our elders always quipped that education is the one asset that nobody can take away from you and Old Money has listened and taken that lesson to heart. It would seem that spending on good education would be a no-brainer for the rich, but it’s gotten even more difficult with the rise in tuition fees, whereas the price of material luxuries
Likewise, investing in any type of education counts. Summer classes at Stanford or Oxford, boarding school, and master’s degrees or even doctorates at renowned establishments all account for indications of this new status of wealth.
The New Indicators of Social Class
If there’s conspicuous consumption, Veblen also identifies an "inconspicuous consumption," which presents itself in less expensive but equally obvious
The Rule of Accessibility
While oligarchs still fly off to private islands and traverse on luxury cars and yachts, they mainly serve as the marketing faces of the luxury sector. They already have everything they need from the get-go and the smaller luxury buys are not of great importance to them. Also, with the aspirational market spending for more of these luxury goods for a smaller price, the demand becomes greater. With greater accessibility, comes a decrease in value.